SUMMARY
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MANILA, Philippines – The terms of the P60-billion LRT-1 Cavite Extension project, one of the big ticket infrastructure projects under the Public Private Partnership (PPP) scheme, have undergone a major revamp to make the project more attractive to investors after the August bidding was declared a failure.
On the sidelines of the Philippine Transit App challenge on Monday, October 14, Transportation Secretary Joseph Emilio Abaya said the changes in the concession agreement were made following consultations with pre-qualified bidders.
“We’ve listened to everybody. We basically addressed their requests,” Abaya stressed.
Abaya said the major changes in the terms are as follows:
- Absorption of the real property taxes by the government
- Warranty for existing structure
- Protection mechanism for power rate increases
- Acceptance of negative bids
Back to square one
The transportation secretary stressed that the re-auction for the project will be open to all bidders.
Abaya added that even previously disqualified firms may participate and private firms may form new partnerships for the next bidding.
“[It will be] open to all, even those disqualified previously. They can always reorganize themselves, everyone can start from scratch,” he noted.
Only Manuel V. Pangilinan-led Metro Pacific Investments Corporation participated in the August 15 bidding after the 3 other prequalified groups withdrew their participation due to concerns on the commercial viability of the rail project.
The revision of the project terms is not unique to the LRT-1 extension project.
Similarly, the concession agreements for the Mactan-Cebu International Airport project and the MRT Automated Fare Collection System were also changed to make them more attractive to investors.
The re-auction of the LRT-1 extension project is set before yearend, after the DOTC gets the approval of the highest social and economic development planning and policy coordinating body this October or November. (READ: LRT-1 Cavite project rebid in 2013 not 2014). – Rappler.com
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